Genting Singapore - OCBC Investment 2016-09-06: Short length of stay by Chinese visitors cap upside for casinos

Genting Singapore - OCBC Investment 2016-09-06: Short length of stay by Chinese visitors cap upside for casinos GENTING SINGAPORE PLC G13.SI

Genting Singapore - Short length of stay by Chinese visitors cap upside for casinos

  • According to Singapore Tourism Board (STB) figures, visitor days from China for Jan-Jun 2016 increased 17.0% YoY despite the 55.2% YoY rise in visitor arrivals. 
  • In terms of length of stay, 24.0% of the visits were under one day and 37.7% were one day long. 
  • The increase in visits of these lengths (under one day and one day) accounted for between 9 to 10 ppt out of the 17.0% growth in visitor days. 
  • We believe the short length of stay as well as STB’s marketing focus on Tier 2 and Tier 3 cities to be key reasons why the robust tourist arrival numbers have failed to translate into greater gambling revenue in the past half-year. 
  • STB recently revealed that Sightseeing, Entertainment, & Gaming expenditure fell 21% YoY in 1Q16, which follows a 13% decline in 2015, and a 6% increase in 2014. 
  • While we remain bearish on rolling and non-rolling volumes in 2H16, we expect upside from Genting’s right-sizing exercises as well as its Jeju development.
  • Maintain HOLD with fair value of S$0.77.




Deborah Ong OCBC Investment | http://www.ocbcresearch.com/ 2016-09-06
OCBC Investment SGX Stock Analyst Report HOLD Maintain HOLD 0.77 Up 0.720


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